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Are You Prepared For a Colorado Earthquake?

Everyone knows they need earthquake insurance, but not every business buys it. Let’s review some facts.

  • The U.S. has about 20,000 earthquakes a year, mostly small, and 42 states are at risk of quakes, according to the U.S. Geological Survey.
  • Just 10 percent of California businesses with property insurance also carry earthquake coverage, according to a recent Napa Valley Register story.
  • Global losses from earthquakes were about $313 million in 2014, higher than 2013 losses of $45 million but far below 2011’s $54 billion, the highest amount ever recorded, according to Swiss Re.

Insurance Coverage for Earthquakes in the United States: Standard business insurance policies do not cover damage from earthquakes. Coverage is available either in the form of an endorsement or as a separate policy. Earthquake coverage is available from private insurance companies rather than from the government.

  • March 2015 forecast from the U.S. Geological Survey (USGS) has upped the likelihood that California will be hit by a magnitude 8 earthquake over the next 30. The most recent calculations differ from those in the earlier USGS forecast in that scientists took into account the possibility that a quake can move from one fault to another, releasing more seismic energy, as well as including newly discovered fault zones. Scientists also said that the probability that the state will be shaken by a magnitude 6.7 quake, similar to the devastating 1994 Northridge temblor, is higher than 99 percent.
  • Most commercial earthquake policies for businesses have a deductible that is based on the value of the building insured. They commonly range from 5 to 20 percent
  • If an earthquake collapses your foundation, you’re not covered. If the earth shakes and a sinkhole swallows your business, you’re not covered. If the earth causes your merchandise to fall off the shelves, shattering on the floor, guess what? you are not covered.

DCInsurers – Mountain, knows how important it is to have the right kind and amount of insurance coverage for your business. We also know how challenging it can be to sort through the numerous different insurance options to find the right policy.

Some information was provided by the Insurance Information Institute.

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